In 2024, New Zealand experienced a notable decrease in median house values, according to Corelogic data. Over the year to December, the median house value dropped by $32,200, marking a 3.9 percent decline from the previous year and a significant 17.6 percent drop below the post-Covid peak. Despite this downturn, values remained 16.2 percent higher than in March 2020.
The month of December alone saw a 0.2 percent decrease, the ninth drop in ten months. While Hamilton, Tauranga, and Dunedin recorded slight increases in house prices, Auckland and Wellington saw declines of 0.4 and 0.7 percent, respectively. Kelvin Davidson, Corelogic’s chief property economist, attributed Auckland’s price softness to the high number of properties for sale, including new builds. Wellington’s market sentiment was affected by public sector cutbacks and economic uncertainties.
Yearly figures showed Auckland’s house prices decreased by 6.2 percent, Tauranga’s by 3.8 percent, and Wellington’s by 6.5 percent. The overall trend reflected higher mortgage rates and a weakening labor market. December’s mild decline continued the year’s pattern of sluggish performance, although the pace of decline appeared to be slowing, hinting at a potential market stabilization.
Davidson highlighted some emerging positive trends outside of Auckland and Wellington, driven by lower mortgage rates and more favorable housing affordability in smaller centers. However, challenges like job insecurity and a high number of available properties persisted. These conflicting forces might continue to influence the market into 2025, alongside potential new credit restrictions such as debt-to-income ratios.
In smaller regions, some areas saw a subtler boost in property values in December, with Whangārei, Gisborne, New Plymouth, Napier, Palmerston North, and Nelson showing increases. Lower mortgage rates and resilient farming-economy support contributed to these local upticks. However, a broader and stronger recovery across the country seemed unlikely until the labor market’s wider weakness is addressed.
Davidson projected a 5 percent nationwide house value increase for the coming year, noting the impact potential debt-to-income ratio rules might have on the market, although these are not expected to halt mortgage lending entirely. The recent declines might conclude shortly, but the market is being closely watched for these emerging financial dynamics.
